<?xml version="1.0" encoding="UTF-8"?><rss version="2.0" xmlns:content="http://purl.org/rss/1.0/modules/content/" xmlns:wfw="http://wellformedweb.org/CommentAPI/" xmlns:dc="http://purl.org/dc/elements/1.1/" xmlns:atom="http://www.w3.org/2005/Atom" xmlns:sy="http://purl.org/rss/1.0/modules/syndication/" xmlns:slash="http://purl.org/rss/1.0/modules/slash/" > <channel> <title>Rail Archives - DG&A Freight Consultants</title> <atom:link href="https://www.dantranscon.com/category/rail/feed/" rel="self" type="application/rss+xml" /> <link>https://www.dantranscon.com/category/rail/</link> <description></description> <lastBuildDate>Sun, 14 Jul 2013 05:11:02 +0000</lastBuildDate> <language>en-CA</language> <sy:updatePeriod> hourly </sy:updatePeriod> <sy:updateFrequency> 1 </sy:updateFrequency> <generator>https://wordpress.org/?v=6.7.2</generator> <image> <url>https://www.dantranscon.com/wp-content/uploads/2024/05/cropped-android-chrome-512x512-1-32x32.png</url> <title>Rail Archives - DG&A Freight Consultants</title> <link>https://www.dantranscon.com/category/rail/</link> <width>32</width> <height>32</height> </image> <item> <title>The Legacy of the Lac-Mégantic Train Disaster</title> <link>https://www.dantranscon.com/the-legacy-of-the-lac-megantic-train-disaster/</link> <dc:creator><![CDATA[Dan Goodwill]]></dc:creator> <pubDate>Sun, 14 Jul 2013 05:11:02 +0000</pubDate> <category><![CDATA[Rail]]></category> <category><![CDATA[Transportation]]></category> <guid isPermaLink="false">https://www.dantranscon.com/the-legacy-of-the-lac-megantic-train-disaster/</guid> <description><![CDATA[<p>The tragic accident in the Quebec town of Lac-Mégantic was the major transportation story of the past week. As of tonight, the death count is at 33 but it will likely reach 50 people when all the bodies are found. In addition, much of the downtown of that town area was destroyed as 72 tanker […]</p> <p>The post <a href="https://www.dantranscon.com/the-legacy-of-the-lac-megantic-train-disaster/">The Legacy of the Lac-Mégantic Train Disaster</a> appeared first on <a href="https://www.dantranscon.com">DG&A Freight Consultants</a>.</p> ]]></description> <content:encoded><![CDATA[<p>The tragic accident in the Quebec town of Lac-Mégantic was the major transportation story of the past week. As of tonight, the death count is at 33 but it will likely reach 50 people when all the bodies are found. In addition, much of the downtown of that town area was destroyed as 72 tanker cars of the Montreal, Maine and Atlantic Railway Ltd., carrying crude oil, caught fire as they came off the tracks.</p> <p>Rail transportation in Quebec, Canada dates back over a century. The rails have been a key element in the history of commerce in this Canadian province. The railway has been hauling iron ore, pulp and paper and other commodities for many years. But the sharp decline in the United States housing market, as a result of the Great Recession, reduced the demand for Quebec’s lumber. This motivated the MM&A Railroad and others to shift their focus to the movement of crude oil via rail.</p> <p>The transportation of crude oil via tanker car goes back to the days of John D. Rockefeller. The rail industry is now hauling more crude oil than it did in those days. Trains transported a record 97,135 carloads of crude in the first quarter of 2013. That’s 166 percent more than during the first quarter of 2012 and 922 percent more than the rails handled during all of 2008.</p> <p>Union Pacific, the largest US railroad, tripled the amount of crude it moved the previous year. BNSF, America’s second largest railroad, is now transporting 650,000 barrels a day versus almost none five years ago. Canadian Pacific Railway expects to haul 70,000 carloads of crude in 2013, up from 500 in 2009.</p> <p>While moving crude oil by pipeline still costs about half to one-third of what it costs to move it by rail, trains don’t require long term contracts or need to wait for pipelines to be built. While pipes stretch only from point A to point B, refiners can access nearly any market in the United States or Canada by rail. Flexibility and the ability to easily shift delivery markets to maximize revenue, has been encouraging oil companies to increase the leasing of rail cars.</p> <p>Much of the increase has come from the Bakken shale formation in North Dakota, the origin of the oil that caught fire in Lac-Mégantic (that was en route to Irving Oil refinery in Saint John, New Brunswick). BNSF and CP now carry 400,000 barrels a day out of the Bakken each day. Seventy-one percent of this oil leaves the region by trains as compared with twenty-five percent in 2012. </p> <p>The crude business has been very important to the bottom line of the major railways. As utilities have switched to cleaner-burning natural gas, coal shipments have fallen 23 percent since 2008. The rails are also becoming important to the pipeline companies as they have begun investing in rail terminals to increase their crude-by-rail capacity.</p> <p>There are several issues that have been brought to the surface by this tragic accident. First, the MM&A Railway had an upswing in accidents during the first six months of this year. The train involved in the accident was inspected the day before the accident. Questions are being raised about running an automated train with one person responsible for the braking, the safety of the cars themselves and why this train was left unattended overnight All of these questions must be reviewed in detail in the coming days.</p> <p>Second, there is the issue of the routing of a train carrying 72 cars of crude oil going through the downtown core of a town. This issue should be expanded to address the question of where is it safe to route a train. Should the rails be allowed to transport crude oil through the center of a city or be routed next to a lake or river? A train carrying more tanker cars could derail in a large urban area or next to a major water way. The potential loss of life and environmental damage could be much larger the next time. This must be re-evaluated.</p> <p>Third, the safety of pipelines should be evaluated at the same time. Within the last few days, it has been suggested that it is much safer to move crude oil via pipeline. The argument is being made to expedite the approval of the Keystone pipeline project. After the BP crude oil spill in the Gulf of Mexico, this suggests that this is the appropriate time to revisit the safety of all modes of transport.</p> <p>Finally, there is the issue of how the MM&A Railroad bungled the PR aspects of the disaster. After five days, Mr. Edward Burkhardt, the company’s CEO, made his way to Lac-Mégantic to give a set of poorly crafted remarks, all in the English language. This made Mr. Burkhardt, his company and the rail industry, look insensitive and out of touch with culture and pain of the citizens of this small predominantly French-speaking Quebec town.</p> <p>Where do we go from here? We live in a society that is very much attuned to the “hot story of the day.” We quickly move from the Newton Massacre to the latest tornado to the Lac-Mégantic disaster. Despite the large loss of life and damage to the city, this story cannot move the Trayvon Martin/George Zimmerman case off the US news networks. Will the issues arising out of this disaster have “legs?” </p> <p>They should. Each of the issues outlined must be addressed. While I am not in favor of more industry regulation, the large loss of life and property damage demands that all modes involved in transporting crude oil be re-evaluated. As a society, we will be using crude oil for the foreseeable future. The legacy of the Lac-Mégantic disaster should be that this incident served as a catalyst to improve the safety of the transportation of crude oil by all modes.</p> <p> </p> <p>My daily transportation newspaper is published 365 days a year. Subcriptions are free. Click on the link to download Dan’s Transportation Newspaper (<a href="http://paper.li/DanGoodwill/1342211466">http://paper.li/DanGoodwill/1342211466</a>).</p> <p>The post <a href="https://www.dantranscon.com/the-legacy-of-the-lac-megantic-train-disaster/">The Legacy of the Lac-Mégantic Train Disaster</a> appeared first on <a href="https://www.dantranscon.com">DG&A Freight Consultants</a>.</p> ]]></content:encoded> </item> <item> <title>CN Rail and CP Rail – Canada’s two “Precision” Railroads set to Power its Economy</title> <link>https://www.dantranscon.com/cn-rail-and-cp-rail-canadas-two-precision-railroads-set-to-power-its-economy/</link> <dc:creator><![CDATA[Dan Goodwill]]></dc:creator> <pubDate>Fri, 09 Nov 2012 19:17:02 +0000</pubDate> <category><![CDATA[Rail]]></category> <category><![CDATA[CITA Shipper Pulse Survey]]></category> <category><![CDATA[CN Rail]]></category> <category><![CDATA[CP Rail]]></category> <category><![CDATA[Freight]]></category> <category><![CDATA[intermodal]]></category> <category><![CDATA[NAFTA]]></category> <category><![CDATA[Railway Association of Canada]]></category> <category><![CDATA[Transportation]]></category> <guid isPermaLink="false">https://www.dantranscon.com/cn-rail-and-cp-rail-canadas-two-precision-railroads-set-to-power-its-economy/</guid> <description><![CDATA[<p>Pierre Berton, the late, famous Canadian author noted in his book, “The Last Spike,” that CP Rail has held a respected place in the country’s history. He wrote that “no other private company, with the single exception of Hudson’s Bay Company, has had such an influence on the destinies of the nation.” For most of […]</p> <p>The post <a href="https://www.dantranscon.com/cn-rail-and-cp-rail-canadas-two-precision-railroads-set-to-power-its-economy/">CN Rail and CP Rail – Canada’s two “Precision” Railroads set to Power its Economy</a> appeared first on <a href="https://www.dantranscon.com">DG&A Freight Consultants</a>.</p> ]]></description> <content:encoded><![CDATA[<p><span style="font-size: 12pt;">Pierre Berton, the late, famous Canadian author noted in his book, “The Last Spike,” that CP Rail has held a respected place in the country’s history. He wrote that “no other private company, with the single exception of Hudson’s Bay Company, has had such an influence on the destinies of the nation.” For most of the past 15 years, CP Rail faced stiff competition from CN Rail as Paul Tellier and Hunter Harrison led the company’s move from a bloated government run enterprise to a highly profitable public company. In fact CN’s operating ratio of 61.3 is not only the best among the major North American railroads, it is one of the best of any company in the transportation industry.</span></p> <p><span style="font-size: 12pt;">The fact that CP Rail lagged so far behind CN Rail and the other class 1 railways in North America led the activist investor Bill Ackman, of Pershing Square Capital, to launch his “palace revolt” proxy battle that resulted in the replacement of CP’s former President with Hunter Harrison, whom he brought out of retirement to drive the railway’s profit improvement.</span></p> <p><span style="font-size: 12pt;">As we pass through the last quarter of this year, Canada’s two largest railroads are heading down separate tracks. With an operating ratio is the low 80’s, Mr. Harrison has embarked on a series of actions to reduce costs through improved asset utilization. This is another way of saying that CP Rail is planning to move its equipment more quickly and efficiently, to become Canada’s second “precision” railroad. It is seeking to accomplish this by undertaking a series of initiatives. These include:</span></p> <ul> <li><span style="font-size: 12pt;">Building trains at CP’s intermodal terminal in Vancouver with blocks of cars for long haul destinations. This reduces stops and streamlines connections.</span></li> <li><span style="font-size: 12pt;">Increasing average train lengths to 7,000 to 12,000 feet</span></li> <li><span style="font-size: 12pt;">Speeding up the fueling of trains</span></li> <li><span style="font-size: 12pt;">Improving daily scheduling</span></li> <li><span style="font-size: 12pt;">Investing $1.2 billion in 2012 and $1 billion in 2013 on key infrastructure projects</span></li> <li><span style="font-size: 12pt;">Working with customers at both ends to improve coordination</span></li> </ul> <p><span style="font-size: 12pt;">The net result of these changes is that CP Rail now provides 4 day transit times between Vancouver and Chicago and Toronto. These changes represent half of the transcontinental trains that CP launches daily across its network. Mr. Harrison is not expecting an overnight drop in the company’s operating ratio. He told Bloomberg News that he is targeting about 65 percent in the next four years.</span></p> <p><span style="font-size: 12pt;">Shippers appear to be taking notice of improved service on both major Canadian railways. </span></p> <p><span style="font-size: 12pt; color: windowtext;">In the 2011 Canadian Industrial Transportation Association Shippers’ Pulse Survey, the respondents gave the railways’ intermodal service a 78 percent favourable rating as compared to 82 percent for LTL and 84.5 percent for truckload. Carload service was ranked at 70 percent. These scores are 45 percent better than the ratings in 2009. The railways’ quality rankings were also up 22 percent as compared to 2010. </span></p> <p><span style="color: windowtext; font-size: 12pt;">The railways offer three primary types of services to its customers – – unit trains, carload service and intermodal. Both railroads are positioned to capitalize on trade between NAFTA partners but also trade with Asia and Europe. Michael Bourque, President and CEO, Railway Association of Canada, highlighted in his presentation at the 2012 Surface Transportation Summit that </span><span style="color: windowtext; font-size: 12pt;">Oil, LNG, shale development (sand, steel pipe, chemicals) are now moving by rail. This is not just a stop gap measure. There are many long term contracts now in place alongside pipeline shipments. The railways can supply capacity and service to a variety of industries.</span></p> <p><span style="font-size: 12pt;">CN Rail, that already climbed the efficiency mountain under Hunter Harrison, is seeking profit growth from these specific opportunities. CN is enjoying steady growth through the Port of Prince Rupert, BC, the closest North American port to the Asian market. The 13% year/year growth in intermodal traffic through this port is helping drive CN’s intermodal volume increase. </span></p> <p><span style="font-size: 12pt;">It is also planning to capitalize on the boom in commodities, namely iron ore. It is expecting to invest $3 to $6 billion on infrastructure to service the mines in Sept-Iles, Quebec, on the Gulf of St. Lawrence, in northern Quebec. Iron ore exports are expected to rise more than 35 percent as China seeks to diversify its sourcing of this key steelmaking ingredient.</span></p> <p><span style="font-size: 12pt;">With such a high profile and well publicized change in leadership, everyone is expecting big things from Hunter Harrison and CP Rail. As rail speeds and efficiencies improve, this will open up a larger share of the truck market for conversion to rail service. With rail being such an energy efficient alternative to road transportation, on longer lengths of haul, we should expect an ongoing series of sales and operations initiatives as both Canadian railways look to capitalize on these opportunities and spur growth in the Canadian economy.</span></p> <p>The post <a href="https://www.dantranscon.com/cn-rail-and-cp-rail-canadas-two-precision-railroads-set-to-power-its-economy/">CN Rail and CP Rail – Canada’s two “Precision” Railroads set to Power its Economy</a> appeared first on <a href="https://www.dantranscon.com">DG&A Freight Consultants</a>.</p> ]]></content:encoded> </item> </channel> </rss>